THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

ANDERSON COOPER, CNN ANCHOR: We begin with breaking news tonight, in the outcry of Pastor Rick Warren speaking in the presidential inauguration. A new voice has entered the fray, Rick Warren himself. His Saddleback mega church tonight, releasing a statement saying, quote, "I commend President-elect Obama for his courage to willingly take enormous heat from his base by inviting someone like me with whom he doesn't agree on every issue to offer the invocation at his historic inaugural ceremony."

Pastor Warren, referring to the firestorm his pick is provoking among gay Americans, their supporters and liberal groups. Today at one of his almost daily cabinet rollouts, Mr. Obama tried to explain his selection.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT-ELECT OF THE UNITED STATES: We're not going to agree on every single issue. But what we have to do is be able to create an atmosphere where we can disagree without being disagreeable. And then focus on those things that we hold in common as Americans.

(END VIDEO CLIP)

COOPER: Well, that's one way of looking at it. To critics, though, it boils down to a single word, betrayal of their rights and his stated principles. We'll talk about that in a moment with our panel.

But before we get to all of that, here's a new interview with Pastor Warren. Listen to what he told NBC's Ann Curry.

(BEGIN VIDEO CLIP)

ANN CURRY, NBC ANCHOR: Are you homophobic?

RICK WARREN, PASTOR, SADDLEBACK CHURCH: Of course not. I've always treated them with respect. When they come and they want to talk to me, I talked to them. When the protesters came, we serve them water and donuts.

(END VIDEO CLIP)

COOPER: Pastor Rick Warren, as we said, Tom Foreman now with the controversy.

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN CORRESPONDENT: The President-elect's choice of evangelical Rick Warren to do the invocation at the inauguration has outrage roaring through the media, especially from liberals, "Legitimizing bigotry is weak. Mad, mad, mad. Face it progressives, we've been conned."

Warren is the founder of the enormous Saddleback Church in California and author of the best-selling book "The Purpose-Driven Life." He's hosted discussions about faith with the candidates during the elections, but his views are strongly conservative.

He has compared abortion to the holocaust, opposes same-sex marriage. He spoke to NBC's "Dateline" about his views on marriage.

WARREN: I mean I even have gay friends like Al Rantel at KABC who is opposed to using the word "marriage" for gay relations. Use another term.

FOREMAN: Warren cites 5,000 years of religious tradition saying marriage can only be between a man and a woman.

WARREN: I am opposed to marriage being used for a relationship between a sister and a brother. I would oppose that. I would oppose the term "marriage" being used for an older man and a baby girl. I would oppose that. I would be opposed for the word "marriage" being used for one man and six wives, or one wife and six husbands.

FOREMAN: Obama's views on that subject are nuanced. Against gay marriage, for civil unions and --

OBAMA: I am a fierce advocate for equality for gay and lesbian Americans.

FOREMAN: But, he says, he wants a government full of diverse views.

OBAMA: What I've also said is that it is important for America to come together, even though we may have disagreements on certain social issues.

FOREMAN: That's not good enough for critics.

MARGE BAKER, PEOPLE FOR THE AMERICAN WAY: Warren's rhetoric marginalizes, dehumanizes and inflicts inordinate pain on particular groups of people who don't share his views or who aren't like him. And that seems just so foreign to what this campaign was about.

FOREMAN: So Obama finds himself in a sticky spot. In reaching out to the religious rite, he has run afoul of at least part of the political left.

Staunch supporters are trying to quiet the ruckus saying remember what he told the opposition on election night. OBAMA: And I will be your President, too.

FOREMAN: He's just keeping a promise, they say, and he's starting on Inauguration Day.

Tom Foreman, CNN, Washington.

(END VIDEOTAPE)

COOPER: Well, it's interesting, that in addition, some evangelicals are criticizing Pastor Warren for accepting the invitation. There's some resistance too in the African-American community from people who want to see a minister from a predominantly black church giving the invocation.

Let's "Dig Deeper" now with CNN senior political analyst, David Gergen, Hilary Rosen of the "Huffington Post" and political analyst, Earl Ofari Hutchinson, author of "How Obama Won." It's good to see you all.

David, I wanted to read you part of a statement by a Democratic Congressman, Barney Frank. He said, and I quote, "Religious leaders obviously have every right to speak out in opposition to anti- discrimination measures even in the degrading terms that Rev. Warren has used with regard to same-sex marriage.

But that does not confer upon them the right to a place of honor in the inauguration ceremony of a president whose stated commitment to lesbian, gay, bi-sexual and transgender rights won in the strong support of the great majority of those who support that cause." Was this mistaken?

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: No. Not in my judgment. Look, I have enormous respect for Barney Frank and understand why he and many others are very upset, even outraged about this.

But I think we have to look at the larger picture. Barack Obama is becoming President of one of the most divided nations in the industrialized world; one that has been almost paralyzed in acting on a variety of fronts because of our deep, deep disagreements. And the way we vilify each other of the people with whom we disagree.

I think we should give this poor man a chance to try something new, to reach out across divides, to see if he can't find common ground among people who may disagree on some issues but agree on others.

So that he's going to do as a president a lot for the gay and lesbian community. He's a fighter for the gay and lesbian community. I think we will see, for example the don't ask, don't tell policy of the military disappear under Barack Obama, a step forward in lowering barriers.

At the same time, Anderson, I have to tell you, I've known and talked with Rick Warren now for several years. And we have our disagreements over gay and lesbian issues, over abortion, over a variety of things. But I've come to respect this man, too. Because I think he has -- what I did see the defining about Rick Warren is not his views on social issues. Those are common to many, many Evangelical preachers.

What defines him is the fact that he has helped millions of people. He's the best-selling author on this planet with "Purpose- Driven Life." He's helped millions of people find religious refuge and strength.

And beyond that, he has fought very hard within the Evangelical community to bring people on his side over to a much more progressive view of global warming, poverty and especially of HIV/AIDS. He has worked very hard on these issues.

So I think we ought to give both these men a more generous understanding of what they're attempting to do. They're attempting to build bridges.

COOPER: Hilary, President-elect Obama insisted today, that he is in his words a fierce advocate for equality for gay and lesbian Americans. Do you believe that, on Proposition 8 he didn't really speak out very much and made a statements but his voice was used to mobilize people to vote for Proposition 8. And now on this, do you think he's a fierce advocate?

HILARY ROSEN, CNN POLITICAL CONTRIBUTOR: I don't know about fierce, but I trust that he's an advocate and will be an advocate for public policy that creates more equality for gays and lesbians.

But I'm sort of fatigued with the explanation of this issue. And I think in some respects the fact that we are still talking about it and it still bothers so many people is emblematic of the fact that it wasn't the right choice.

You know, I disagree with my friend David Gergen. I think that both he and President-elect Obama just really don't get it on this issue. That it's not a policy difference. It is really a dehumanizing way that Rick Warren talks about gay relationships. And that if he were talking about relationships among any other people, to compare gay relationships with incest or pedophilia, the way we just heard him do, is simply unacceptable.

That's not a policy difference the way that the President-elect said it today. You know, if that were discussed about African- Americans or Jews, or anything, it wouldn't be a policy difference. It will just simply be unacceptable and that's what I think people just don't get. This is not about gay marriage.

COOPER: Earl, what about that, I mean, if Rick Warren had substituted the word "black" or African-American or every time he said gay and lesbian, people would be outraged, no?

EARL OFARI HUTCHINSON, SYNDICATED COLUMNIST: Yes, I think they would be outraged. But I think people are outraged too even without accepting that or inserting. But I think there's two other things that I think are missing.

We have to realize one thing when we go back in time. Obama is not doing or saying anything different than he did or said during the campaign. He went to Rick Warren's church back in August. He sat down with Rick Warren and John McCain. He talked about gay marriage. He talked about abortion. He talked about lesbians. He talks about all of these things. Values, morals and social issues; he talked about these things.

He also said something else, during the campaign that made it very clear. I am going to outreach to Evangelicals. Now, he knew full well chances were very slim that the most conservative Evangelicals were going to support him. But yet and still he said that, he tipped that.

So it's not new we shouldn't be surprised. Is this unacceptable about some of the things that Rick Warren has said? Some of his positions? Absolutely.

But the other thing is we've got to remember one thing. It's not just about building bridges and breaking down the barriers, Obama is a political animal. We have to remember that.

And so when you really put him in that context, none of this, and I mean, none of this, reaching out to Rick Warren, Donnie McClurkin who was also beat up on for being a gay basher and a homophobe, none of this should surprise.

ROSEN: I think that Earl makes an interesting point and one that, frankly, I have supported President-elect Obama in this entire campaign. I like that he wants to make -- build common ground with Evangelicals. I think there's a lot for the progressive community to learn.

And I think ultimately it will lead to greater understanding for gay and lesbian people and for families, for Evangelical families that have gays and lesbians, children, and brothers and sisters, which, of course, they do.

I think the only issue is, is this the day to start to play sort of political coalition building? Or is this the day to just celebrate a much more neutral nuance, unifying way to look at the country? That's all. I think they've made their bed in the Presidential Inaugural Committee.

I don't think this decision is going to change. You know, it's disappointing. And I think they've decided that they had a constituency they just weren't going to worry that much about complaining about this.

Let us know what you think about the controversy. Join the live chat happening now at ac360.com. Check out Erica Hill's live web cast during the break as well.

Up next, breaking news on Al Franken-Norm Coleman's senate race; finally we may have a winner.

Also Caroline Kennedy, she's been running a stealth campaign to become senator. Today, she spoke, a little bit in public at least. Hear what she's saying about her qualifications to be senator and see why she and Reverend Al Sharpton were breaking bread.

Later, disclosing the dollars: which billionaires, which companies and countries gave Bill Clinton nearly $500,000 for his charitable foundation?

What do you call a guy with four ex-wives, one of whom is dead the other one is missing? What do you call the woman who now wants to marry this guy? The strangest twist yet in the Drew Patterson case. Still married, a murder suspect, and now engaged. Tonight on "360."

(COMMERCIAL BREAK)

COOPER: New developments as well today in a senate race that requires only a single vote to win, that of New York Governor David Paterson. We're talking of course, about Hillary Clinton's soon to be vacant seat. Caroline Kennedy wants it, her reticence though to talk to reporters or for that matter citizens of the state she wants to represent has drawn some comparisons to Sarah Palin.

Today, however, she talked a little.

Mary Snow has the "Raw Politics."

(BEGIN VIDEOTAPE)

MARY SNOW, CNN CORRESPONDENT: The press of cameras greeted Caroline Kennedy in Harlem. This stop, a pow-wow with the Reverend Al Sharpton at Silvia's, a famous New York soul food restaurant that hosted many of politicians, including the Clintons and President-elect Barack Obama.

It comes one day after Kennedy visited three cities in upstate New York. She's famous for avoiding reporters but fielded a few questions in Harlem such as why she wants to be a Senator.

CAROLINE KENNEDY, SEEKING CLINTON'S SENATE SEAT: I come as a mother, as a lawyer, as an author, as an education advocate, and you know, from a family that really has spent generations in public service. And I feel this commitment. This is a time when nobody can afford to sit out, and I hope that I have something to offer.

SNOW: Kennedy has been drawing both attention and criticism. Some Democrats question her qualifications and experience compared to about a dozen other contenders. She was asked what she'll need to learn.

KENNEDY: I have quite a bit to learn. But I feel like I bring a lot with me as well. SNOW: Kennedy and Sharpton made a point of saying they respect Governor David Paterson's process of appointing a replacement for Senator Hillary Clinton assuming she becomes Secretary of State. But Sharpton praised Kennedy and so has New York Mayor Mike Bloomberg, although he refused to say on ABC's "The View" whether he backs her personally even though one of his aides is pushing hard to get Kennedy chosen.

MICHAEL BLOOMBERG, (R) NEW YORK MAYOR: I should stay out of this race. It's up to Governor Paterson, he's lucky to have a number of different candidates. I was asked about Caroline Kennedy. She's very competent; she has done a lot for New York City.

SNOW: Critics say all the attention on her could back fire. Democratic strategist Hank Sheinkopf who once worked for Bill Clinton does not think she should be chosen.

HANK SHEINKOPF, DEMOCRATIC STRATEGIST: There're a lot of Democrats who aren't happy about this. Frankly, why go outside the home team when there's a lot of good players here.

SNOW: Some feminists groups like the National Organization for Women want to see a female replace Senator Hillary Clinton. NOW is calling on people to contact the Governor's office to voice their support for a female Senator. But the group is endorsing Congresswoman Caroline Maloney, not Caroline Kennedy.

Mary Snow, CNN, New York.

(END VIDEOTAPE)

COOPER: All right. Let's talk "Strategy" now. Back with our panel, David Gergen of the Kennedy School of government which we should point out Caroline Kennedy is affiliated with; Hilary Rosen, as well as Earl Ofari Hutchinson.

So David, is lunch with Al Sharpton in front of the TV cameras another a sign that this thing is basically a done deal?

GERGEN: It's almost done, Anderson, in my view. But David Paterson the governor, now finds himself caught in the cross fire doesn't he? He's probably going to be damned if he does and damned if he doesn't. He's got another candidate in Andrew Cuomo who is extremely well qualified; the son of a former governor who has had distinguished public service. You know, he's got other women involved with this. I think he's in an unenviable position.

But good for Caroline Kennedy to go out; I've spoken out favorably about her a couple nights ago. I think to go out upstate and talk to the Mayors up there and begin to take some questions from the press, she wants to see how much she really enjoys the rough and tumble.

She's going to take a lot more of this. And I don't think she's any Sarah Palin. I think she's just a very different person and let us put it that way. But we'll see. COOPER: It's interesting, Hilary, because I mean, she's obviously well-known in media elite circles. But the American public really hasn't ever really heard her speak much or speak out on any causes ever, in probably her entire life, except maybe a little bit on public education if they've been listening very carefully.

I mean, doesn't she owe it to the citizens which she apparently wants to represent to talk to them?

ROSEN: Well, I agree with David. I think its kind of fun to see her out there mixing it up and going upstate. And she's not sitting back in a Park Avenue apartment and waiting for people to come calling. She's meeting the people.

COOPER: But she's not talking to citizens.

ROSEN: You know, I don't think -- this is an odd situation she's in. There is a single voter in this election and that's Governor Paterson. I think what she's tried to do is get out there enough so that people knew she was serious, making a couple trips around the state.

But, you know, I keep getting calls from people close to Governor Paterson saying, no, no, no, he wants to be able to choose from a bunch of people. He hasn't made up his mind yet. But, you sort of can't fight something with nothing. And so unless Governor Paterson comes out and says he's for somebody else, there's a lot of momentum right now for Caroline Kennedy.

And I think that whether people like it or not, her mystique and her celebrity add stature to candidates -- it's simply a fact of life.

COOPER: Earl, do you think she should be talking more to the public?

HUTCHINSON: And I think she's certainly is talking more to the public. But also, we have to hear from the public, too. One of the things that's bothered me from day one when Caroline Kennedy's name was floated initially, is what do the constituencies in New York, across the board, especially in upstate New York, what do they really think about a Caroline Kennedy? We really haven't heard much from them.

I mean, certainly, I do agree, we do need fresh voices, fresh faces, new ideas, innovative thinking and energy. No question about that. Politics is too much a good old boy, and good old girl, deal making and back room wheeling and dealing game. We all know that.

But at the same time I'm mindful of something else. I don't think we can or should -- I think it's very dangerous to minimize experience -- especially when we're facing something, not only in California where I am, but certainly in New York, a major, major fiscal economic and budget crisis.

New York is really strapped. It's really under the gun. You're going to have to have somebody that can go in there, and hit the ground running, know exactly how you can really maneuver in the political system, who you can talk to, who the players are. Where things can be done and really push the envelope.

I'm not sure Caroline Kennedy as well meaning, well intentioned, the good public servant that she is, I'm not sure she fits that bill.

COOPER: David?

GERGEN: Well, I don't really think that's the role of the Senators to run the country. That's what we elect the President to do. And I think that part of what the role is going to be for the next two year's -- let's remember, we're only talking about somebody who's going to fill a seat for two years until there's a general election.

We're not talking about a lifetime appointment here. And I think that what she would bring to the senate is a -- I think she brings a kind of passion that would stir people. I think that she would help in the confidence building which is going to be so necessary over the next two years. But, Anderson, I want go back, you mentioned something and I it was a good idea that I thought about, I do think it would be a good idea for her as you suggested to give a major speech in the next few days to let us know what her vision of the country is.

She's written a few books as she said, but we don't have a fair -- most citizens do not have a strong sense of what it is she believes in her core.

COOPER: I mean, I don't want to interrupt, but I've honestly never heard her talk more than a few sentences.

ROSEN: Yes.

HUTCHINSON: That's not good enough.

COOPER: I mean, once when we interviewed her with Wolf Blitzer, you know, about Obama and Clinton. I have no idea what she believes. I assume you do, you've had more contact with her.

GERGEN: I have more contact with her but I think your point is well taken, the public deserves to know.

HUTCHINSON: Exactly.

GERGEN: And I think a public speech is a very good idea and then answer some questions after it's over.

COOPER: We'll she'll give a speech and she can come on the program and she can talk to all of us, maybe. Well, we invite her. She's welcome anytime.

We got to leave it there. Earl Ofari Hutchinson, it's good to have you in the program for the first time.

HUTCHINSON: Thank you.

COOPER: Hilary Rosen, always great to have you and David Gergen as well. Thank you.

Up next, secrets revealed, Bill Clinton disclosing who gave money to his charity; hundreds of millions of dollars. See where all of the money is coming from.

Later the auto industry teetering on the brink with hundreds of thousands of jobs at stake, billions of tax dollars needed for a bailout. The White House has promised help is on the way. So why are they now talking about bankruptcy? Try to figure that one out. We'll be right back.

(COMMERCIAL BREAK)

COOPER: Today, former President Bill Clinton made good on his promise to do everything he can to help his wife become the next Secretary of State. The Clinton charitable foundation released its donor list, one of many conditions he agreed to before Clinton accepted the nomination.

Now, until now, the list has been top secret, as you know. The question is, who's on it and will they be a problem for Hillary Clinton.

Taking an "Up Close" look, Joe Johns.

(BEGIN VIDEOTAPE)

BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES: Thank you, thank you.

JOE JOHNS, CNN CORRESPONDENT: No more questions about what, if anything, Bill Clinton is hiding. After resisting this for ten years, his list of more than 200,000 donors who gave at least $492 million is now an open book.

Nearly 3,000 pages long and posted online. The biggest two donors far and away, are a British charity group called the Children's Investment Fund Foundation, dedicated to improving the lives of children in poverty. And UNITAID, a World Health Organization partnership to fight HIV/AIDS, both donated more than $25 million.

But the eye-openers, if you could call them that, are the foreign interests in the Middle East: the Kingdom of Saudi Arabia, at least $10 million; Kuwait, Qatar, Oman, Dubai, each at least $1 million.

So the question is whether donations to Bill Clinton's foundation could somehow complicate Hillary Clinton's confirmation as Secretary of State and if she's confirmed, her getting the job done.

UNIDENTIFIED FEMALE: Saudi Arabia, specifically, and the Middle East and India are all going to be flash points that the next Secretary of State is going to have to deal with early.

JOHNS: Other donors seemingly could complicate things for Hillary Clinton or at least create questions at her confirmation hearing. Amar Singh lobbied Congress, including Senator Clinton to allow India to get nuclear fuel and technology. The same guy gave at least $1 million to the Clinton Foundation.

And the controversial security firm, Blackwater, which recently had five employees indicted over a firefight in Baghdad, also gave a small donation. The next Secretary of State will have to decide whether Blackwater keeps its contract to protect American diplomats.

If any donor starts looking like a conflict of interest for Hillary Clinton, a longtime friend and aide says she can just take herself out of the loop.

LANNY DAVIS, FORMER CLINTON AIDE: The commitment is 100 percent that whatever the White House, whatever the President wants, the Secretary of State will do because he is the President.

JOHNS: With such a long list of names, at least the minefields are out in the open.

Joe Johns, CNN, Washington.

(END VIDEOTAPE)

COOPER: Next up on "360," he threw his shoes at President Bush, called him a dog, now facing years in prison, he's asking for leniency. A twist today in the case of the Iraqi journalist who became the story and a folk hero to some in Iraq.

Plus, Drew Peterson, the former cop who remains a suspect in the disappearance of his fourth wife, ready to tie the knot again. He hasn't had his marriage rights taken away even though he's still legally married to his missing wife. Does anything stand between Drew Peterson and his wife number five? Find out tonight.

(COMMERCIAL BREAK)

COOPER: Justice today, an unthinkable crime, a former colonel in the old Rwandan army was convicted today of genocide, sentenced to life in prison. His name is Theoneste Bagosora. He's the most senior military official to be found guilty in connection with the 1994 massacre of 800,000 Tutsis and moderate Hutus.

Bagosora's trial took six years; the slaughter that he set in motion lasted 100 days literally turning Rwanda's small country of incredible natural beauty into a killing field. I was there for a brief time during the slaughter reporting for Channel 1. What the world witnessed there should never be forgotten.

As a brief reminder, a short clip of a report I filed in 1994, and I want to warn you, some of the images that you're about to see in this "360 Dispatch" are graphic.

(BEGIN VIDEO CLIP)

COOPER: With scenes like this, you try to figure out what it is that happened here. It looks like a van filled with passengers. Maybe hit something or was hit by a rocket or something. The smell of rotting flesh is everywhere in the air.

You stare at the bodies, try to make sense of it, search for answers but you find none, all you find are more bodies. And the silence; the silence is what gets to you. Broken only by the sound of flies and the buzzards circling overhead waiting for you to leave.

ERICA HILL, CNN CORRESPONDENT: Anderson, the man behind that toss seen around the world now saying he's sorry. A hand written apology to the Iraqi Prime Minister Muntadar al-Zaidi called the shoe throwing incident, called a quote, "great ugly act" and pleaded for leniency. He is expected to stand trial soon.

Insider trading charges from the SEC levied against a former Lehman Brothers employee. Matthew Devlin is accused of raking in $4.8 million using illegal information he obtained from his wife who worked at an international PR firm.

Remember those $54 million pants? Oh, yes, the lawsuit. The judge who sued his dry cleaner for the missing pants, all told, worth $54 million in his eyes denies by the D.C. Court of Appeals. In fact, the court said Roy Pearson's appeal had no merit. As for the Chung family which owned the dry cleaners, they say they hope now that their three-year nightmare is finally over -- Anderson.

COOPER: That's ridiculous. Erica thanks.

Now, time for our "Beat 360" winners; our daily challenge to viewers to come up with a better caption than one that we could think of for a photo that we put at ac360.com. Tonight's picture, Orange County officers used a radar gun to determine speed violators in Orlando, Florida and their dressed like the Grinch.

Our staff winner tonight once again is Sean, with this: Sir, I'm with Fashion Police, and you're going to have to come with me."

HILL: Back from the long vaca-honeymoon wedding? Twice in a row.

COOPER: Our viewer winner is Josh from Burbank who waxed poetic: The Grinch's small wallet grew three sizes smaller! For he whizzed by the sheriff and the radar did holler!

Congratulations, I think that's the first sort of limericky one we've had. Your "Beat 360" T-shirt's on the way. Go to ac360.com and you can play tomorrow and every day.

Let's move along. Up next, new developments in the auto bailout battle; President Bush speaking out today on how the White House plans to help.

Plus, $1.5 million for a new water park ride. Is this what mayors are talking about when they asked for $73 billion in emergency federal money? We're "Keeping Them Honest."

And he's been married four times. One of his wives is dead and another missing and presumed dead. Why would anyone one want to be wife number five? Meet Drew Peterson's new fiancee coming up.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Under ordinary circumstances, failing entities should be allowed to fail. I have concluded these are not ordinary circumstances.

(END VIDEO CLIP)

COOPER: President Bush kind of kicked back, just talking about the desperately ailing auto industry. All three U.S. carmakers are looking at extended shutdowns over the holidays. Mr. Bush said he hasn't decided how to deal with the crisis. But for the first time today, the White House said it is looking at what they call orderly bankruptcy as an option.

What exactly does that mean? Billions of dollars and thousands of jobs are at stake. We're talking about your money, your future. Let's talk now with White House correspondent Ed Henry and chief business correspondent Ali Velshi.

What is this orderly bankruptcy?

ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: It's not a formal term. What it means generally, bankruptcy is a protection from your creditors. A lot of people think bankruptcy is just going out of business. Bankruptcy actually buys you time to renegotiate with your creditors, renegotiate any contracts you have with your employees, renegotiate leases and all things like that.

An orderly bankruptcy or managed bankruptcy suggest that you say go into it with some understanding of what might happen on the other side and that the government might back it up. You'll recall, that the automakers made the argument that if they go into bankruptcy, it would go into liquidation; that's Chapter 7. Bankruptcy's Chapter 11. No one would buy.

COOPER: No one would be buying cars from a company that was going bankrupt?

VELSHI: But a study came out, the same group that they were quoting from came out with a study this week that said if it were a government backed bankruptcy, people would actually buy those products. COOPER: Interesting.

Ed, the White House said they're very close to a solution. President Bush signaling today he doesn't want to leave it for President-elect Obama. I want to play that.

(BEGIN VIDEO CLIP)

BUSH: I feel an obligation to my successor. I believe that good policy is not to dump him a major catastrophe in the first day of office.

(END VIDEO CLIP)

COOPER: It's interesting, Ed. They were talking last weekend about the White House possibly making the decision over the weekend and here we are. I've got to tell you, just from the president's body language, he doesn't seem to be in a big rush.

ED HENRY, SENIOR WHITE HOUSE CORRESPONDENT: You're right. And he's in a bind right now; in a public relations war, if you will. Because he had suggested there'd be some quick action and they'd make a decision quickly. And you're right; he sort of kicked back literally and figuratively.

But the bottom line is when you read between the lines on what he's actually saying, he is going to act on this. The only question really left is how big is the bailout going to be and what are going to be the strings that are attached. That's the key because he's being squeezed right now on his legacy.

On one hand, he has conservatives saying, stop, there's been too much money spent. You're not really a conservative. Bailout after bailout, we have bailout fatigue. His conservatives are pressuring him.

But on the other hand, he has other people advising him, look, do you want your legacy to be the failure of an American icon, GM and/or Chrysler as well? That's why it's clear he is going to act. Dana Perino said on "Larry King Live" that we're going to hear from the president soon. That's White House code for a decision is almost there. You can bet he's going to act, it's just a question is, how big, Anderson.

COOPER: The bottom line though for these companies, for Chrysler in particular, people aren't buying their cars. How does a bankruptcy, orderly or not, change that?

VELSHI: Yes and in fact, Chrysler said specifically, when it announced yesterday that they'll be closing its plants for a month instead of the normal two weeks. They said part of the problem is credit. Their buyers can't get credit. They go in with willingness to buy a car and they can't get credit.

We've heard this from Ford, we've heard it from GM, we've heard it from Nissan, we've heard it from the rest of them. Not entirely sure what the bailout loan does for them in that particular instance. But the bottom line is, finally, the White House does seem engaged. For all the options that they didn't state they were giving, what they didn't say was that nothing was going to happen. They did say something will happen; they're close to some decision.

COOPER: And talking about lawmakers themselves. I think maybe a lot of people don't realize, Congress automatically gets a raise every year. They actually had to pass legislation to stop the automatic pay raise, very convenient that. They're getting an extra $4,700 next year. Has anyone talked about maybe them agreeing not to take a pay raise?

HENRY: Nobody has yet, but you can guarantee it's going to happen eventually because that looks awful for members of Congress especially since they did not act on this auto bailout. They've talked about it, talked about it for weeks. They dragged the big three auto companies up there. Made them lay out their plans. They did lay out the plans and then Congress couldn't act.

So we're in the middle a recession right now. They appear like they're not acting. The president now has been dragging his feet for a few days now. Maybe he finally will act in the next few days but I think there will be a lot of pressure on lawmakers. That's a symbolic move in terms of their pay.

But in general, there's going to be a lot of frustration about the fact that Washington appears to be sort of deadlocked right now.

VELSHI: This may ruin mine and Ed's weekends, but the bottom line is this story has shifted back to Washington. Washington needs to act on this. We can't dawdle anymore. It's almost Christmas.

GM said it's going to be out of money by the end of the year. Whatever one decides it has to be decided. It's almost like we're just waiting. It's like attrition; we're just waiting for this to end. We can't wait. Washington's got to do something.

COOPER: All right. Ali Velshi thanks. Ed Henry thank you.

Coming up, shovel-ready projects, that's what the Barack Obama calls them. Governors call them that, mayors call them that. Infrastructure projects we're talking about at the state and city level waiting for federal funds and it turns out, for federal pork for a polar bear exhibit, a water slide, a dog park and even a program to get prostitutes off the street.

Is this the kind of infrastructure that Barack Obama is talking about pouring money into? We're "Keeping Them Honest."

Plus, Drew Peterson, still a suspect in the mysterious disappearance of his fourth wife, Stacy, now engaged to be married to wife number five. What are you going to get them for their wedding?

We'll be right back.

(COMMERCIAL BREAK) (BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT-ELECT OF THE UNITED STATES: We've got shovel-ready projects all across the country. And governors and mayors are pleading to fund it. The minute we can get those investments to the state level, jobs are going to be created.

(END VIDEO CLIP)

COOPER: President-elect Barack Obama eager to make infrastructure spending for decaying bridges and highways a top priority. A lot of mayors and governors say they have infrastructure projects that are ready to start as soon as they get some cash. Shovel-ready as you heard Obama say. But as you're about to see, it appears that some of those projects may have less to do with infrastructure and more to do with good old-fashioned pork.

Special Investigations Unit correspondent Abbie Boudreau is "Keeping Them Honest."

(BEGIN VIDEOTAPE)

ABBIE BOUDREAU, SIU CORRESPONDENT: You might not think a nearly $5 million polar bear exhibit in Rhode Island would help turn around the economy. But the U.S. Conference of Mayors sure thinks so. It's one of more than 11,000 ready to go infrastructure projects proposed by 427 cities totaling $73 billion.

PETE SEPP, NATIONAL TAXPAYERS UNION: To the people supporting them, these proposals aren't a joke. But to the taxpayers funding them, yes, it will be a joke to them. Only they won't be laughing.

BOUDREAU: This month, Miami Mayor Manny Diaz, president of the U.S. Conference of Mayors and other city leaders, went to Capitol Hill to make their cases.

MANY DIAZ, MAYOR OF MIAMI, FLORIDA: Our plan calls for investments that will stimulate our economy by quickly creating jobs.

BOUDREAU: Mayor Diaz even held up the report saying the projects aren't a bailout but a build-out, to put Americans back to work.

Did you have a chance to even read the report?

DIAZ: I read through a lot of it. Honestly, I didn't sit there and look at all 11,300 projects that were submitted.

BOUDREAU: Why is that?

DIAZ: Why is that? I didn't have time.

BOUDREAU: If he made the time he would have found projects like a $20 million minor league baseball museum, $42 million for improvements to zoos, $3 million for murals, even $1.5 million for a new water park ride.

DIAZ: You can't simply just say that because something sounds like it isn't right that it isn't in fact right.

BOUDREAU: A new ride at a water park?

DIAZ: Well, again, I'd have to look at that particular project and try to understand why that city feels that it's an important project. Again, we're talking about 11,300 projects, not just one.

BOUDREAU: The new ride at the water park is in your city?

DIAZ: Yes.

BOUDREAU: So, what is your response? I'm asking you as a mayor? I'm surprised that you didn't know about the new ride at the water park?

DIAZ: Well, we had a number of projects and I don't know which one you're referring to but we just built a new water park and it may be related to that water park or maybe outside the city. I'm not sure.

BOUDREAU: $1.5 million for a new ride at the water park?

DIAZ: The point is that part of investing an infrastructure also includes parks.

BOUDREAU: There are plenty of roads, treatment and water treatment projects. But also skateboard parks, museum and zoo renovations, aquatic centers, bike and horse paths, a dog park and programs beyond infrastructure. To help prostitutes get off the streets and to buy thousands of tasers for police departments.

The total cost, more than $300 million. And get this, many of the projects wouldn't even create jobs.

SEPP: It's impossible for any normal tax-paying American to read this and not come away scratching your head and saying, wait a minute, this isn't about infrastructure. This is about political power grabs, money grabs.

BOUDREAU: To the average American, doesn't this sound like pork?

DIAZ: I don't know yet. You'd have to ask the average American.

BOUDREAU: Abbie Boudreau, CNN, Miami.

(END VIDEOTAPE)

COOPER: Well, does it sound like pork? Let us know at ac360.com. The live chat is happening now.

Up next, a strange new twist in the Stacy Peterson disappearance case; her husband and prime suspect is engaged. Stacy isn't the first wife that he's suspected of killing so why would anyone want to be wife number five?

Also ahead, something that caught our on Letterman last night, Jim Carrey and Larry King in a bath tub. Need I say more?

It's our "Shot" today.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Drew, do you want to talk about --

DREW PETERSON, SUSPECTED IN MISSING WIFE'S DISAPPEARANCE: What I want -- what I want to talk about is I'm going to come camp myself in front of your house and see if you like it.

(END VIDEO CLIP)

COOPER: Drew Peterson more than a year ago with all the reporters following his every move. He's been living under a microscope since becoming a suspect in the disappearance of his fourth wife, Stacy Peterson.

But now, through an announcement from his publicist -- yes, he has a publicist -- we learned he's proposed to a woman he hopes will become wife No. 5.

Erica Hill has more now on the ex-cop who seems to find the media annoying except when he wants to get in the headlines.

(BEGIN VIDEOTAPE)

HILL: His fourth wife vanished more than a year ago. Now, Drew Peterson is moving ahead with plans for a fifth marriage.

Peterson met with a divorce lawyer last month, but his main attorney says there are, quote, "no specific plans" regarding a divorce yet. But to marry his new fiancee, he'll need one.

LISA BLOOM, ANCHOR, "IN SESSION": I think his chances are very good in getting a divorce. After a year of Stacy being gone, he can establish abandonment in Illinois. And that's the same as in most states when a spouse simply takes off. He can establish that, and he can get the divorce.

HILL: From the moment Stacy Peterson disappeared, this former suburban Chicago cop has commanded attention.

PETERSON: What I want to talk about is I'm going to come and camp myself in front of your house and see if you like it.

HILL: Not just for his love/hate relationship with the media, but also for his unorthodox history with women. His second wife once told the "Chicago Tribune" he said he could kill her and make it look like an accident. She is still alive.

His third wife, Kathleen Savio, was found dead in her bathtub. Ruled an accident in 2004, Savio's death was reclassified as a homicide following a second autopsy after his fourth wife's disappearance.

Drew Peterson has not been named a suspect in his third wife's death, but he is a suspect in Stacy's disappearance, though he has not been charged with a crime.

PAM BOSCO, STACY PETERSON'S FAMILY SPOKESPERSON: It leaves one an eerie feeling of dread. We -- we realize that Kathleen and Stacy had one common denominator, and that was Drew Peterson.

JOEL BRODSKY, DREW PETERSON'S ATTORNEY: We have a guy that had one wife die who died of an accident and another one who ran off, which may make him unlucky, but nothing mischievous about either of those two things.

HILL: Despite her family's claim to the contrary, Peterson has always said Stacy left him, something he told Larry King as recently as last spring.

PETERSON: She told me she found somebody else and she was leaving.

HILL: We now know Drew Peterson has found someone else. Stacy Peterson's family isn't giving the announcement a lot of thought, saying they'd rather focus on the investigation into her disappearance.

(END VIDEOTAPE)

COOPER: So why the press release, I mean, if he wants to stay out of the spotlight?

HILL: It was interesting. I spoke to both his publicist and his lawyer today. And they both said, "Look, we didn't put this press release out because we wanted to tell everybody he was engaged." Another man dug it up, had been talking about it. They had so many calls that they felt they had to release this statement.

But they're also not confirming who the girl is, despite some media reports that may have spoken to her father. They won't confirm her name.

COOPER: All right. Erica thanks. Strange.

Just ahead, what would it take to get actor Jim Carrey and Larry King to share a bubble bath on national television? Not much, apparently. It's our strangest "Shot" ever.

And new developments in the story that's become a speed bump in the Obama transition; Pastor Rick Warren today speaking out, commending President-elect Barack Obama for taking heat on his behalf. The latest, ahead.

(COMMERCIAL BREAK)

COOPER: Time now for "The Shot" Erica. Actor Jim Carrey promoting his new movie, "Yes Man" on Letterman yesterday by reading a "Top Ten Things Jim Carrey Will Always Say Yes To."

The skit was full of surprises. For starts, Carrey did it via satellite from a bubble bath. And it ended with perhaps the biggest surprise of all. Take a look.

(BEGIN VIDEO CLIP)

DAVID LETTERMAN, HOST, CBS'S "THE LATE SHOW WITH DAVID LETTERMAN": The category, No. 1 thing Jim Carrey will always say yes to. Here it is, No. 1.

JIM CARREY, ACTOR: Tub time with Larry King.

LETTERMAN: What does that mean?

(END VIDEO CLIP)

HILL: Oh, yes.

COOPER: Yes.

HILL: Do you think that either one of them was wearing Flame in the bubble bath?

COOPER: Was wearing what?

HILL: Flame.

COOPER: What's Flame?

HILL: It's the cologne that you've been smelling over there in the studio. We've been talking about it all the time. It's supposed to smell like burgers.

COOPER: Oh, that's that...

HILL: A Whopper.

COOPER: Is that Burger King's, like...

HILL: Yes, but it's -- it's...

COOPER: Why does Burger King come out with a cologne? That I don't understand.

HILL: I don't know. But you know what I was shocked? It's like $3.99 a pop, so it's fairly reasonable.